If you’ve been waiting for a dramatic rate cut this December, you might want to adjust your expectations. The latest October inflation report shows inflation hit 2%, up from 1.6% last month and higher than the 1.9% forecasted.
What does this mean for Toronto real estate in 2025? Let’s break it down and see what’s ahead!
The Inflation Breakdown
So, what exactly happened with inflation this month?
- Energy prices didn’t drop as much as they did last month.
- Food prices climbed.
- Goods went from deflation to slight inflation.
- On the plus side, mortgage expenses are easing, rents are cooling, but property taxes have seen their biggest spike since 1992.
If we exclude gas prices, inflation held steady at 2.2%, which is still higher than expected. This means the Bank of Canada will likely opt for a smaller rate cut of about 25 basis points on December 11.
A smaller cut still means some relief for homeowners with variable-rate mortgages. For buyers, this could make it easier to get into the market, especially since more people are going for variable-rate mortgages these days.
What’s Happening in Toronto Real Estate Right Now?
As we head into the holiday season, the real estate market will naturally slow down.
Sellers typically don’t want to deal with showings and negotiations during the busy Christmas period, which means if you’re looking for deals, you might just get lucky. Motivated sellers might be more willing to make a deal now, which could give you an edge. However, if you plan to buy, keep in mind it might be tougher to find the right property as the season winds down.
Looking to 2025, things are shaping up to be much more active. Expect lower rates and the typical “new year, new goals” energy. Buyers and sellers will be looking to kick off their fresh strategies, and there’s a backlog of transactions that’ll see people re-engaging who’ve been holding off since November.
The big players, who have been sitting on the sidelines due to current market conditions, will also jump back in come 2025.
What’s on the Radar for Investors?
So, what are the bigger investors eyeing?
Condos? Not so much. Most condo buyers are investors, but with cash flow not working well and weak appreciation potential, condo deals are stagnating.
Retail and industrial real estate don’t look appealing either, mainly due to recession fears.
However, here’s the exciting part—multiplexes and infill projects. Multiplexes have traditionally been too small for large investors and too big for smaller ones, but thanks to recent policy changes and a shifting market, they’re becoming much more attractive. Here’s why:
- Higher rents in Toronto mean stronger valuation lifts for these properties.
- There’s no development charges for up to five units in Toronto, plus 100% HST rebates on construction for larger multiplexes.
- Add to that the strong cash flows in a softer market and lower future refinancing rates, and you’ve got a solid investment opportunity.
With demand for Toronto’s low-rise properties growing—from families wanting to own homes to small investors looking for better rent yields—larger institutional players are also eyeing multiplexes for reliable, better returns.
How We Can Help
Toronto’s housing crisis isn’t going anywhere, and that will continue to support the Toronto real estate market. With more buyers entering the market and supply still constrained, Toronto multiplexes are expected to keep outperforming.
If you’re thinking about what’s ahead in 2025 or need help with your next move, let’s talk! Our Toronto-based real estate brokerage specializes in multiplex properties.
Whether you’re buying a ready-to-rent property, converting a space, or building new, we’ve got the expertise to guide you through. Here’s what it’s like to start as a client with us:
- Initial Consultation: We’ll talk with you to understand your needs and teach you how to invest wisely in Toronto real estate.
Market Search & Purchase: We’ll search the market to find the perfect property for you.
Renovation Support: If the property needs renovations, our trusted contractors are ready to help, and we’ll coach you as you manage the project.
Leasing and Management: If you need help renting out and managing your property, our leasing and management team is here for you.
Ready to get started? Click on the link below, and let’s start working together!
What Toronto Real Estate Investment Is Right For You?
Check out our complete Toronto real estate investment guide for all the details and real-life examples. If you’re ready to dive in, just book a call with us!
